Rio Tinto
chief executive
Tom Albanese
has given a frank assessment of investors’ perceptions on mining in Australia, specifically Queensland.

“I am sorry to say now, frankly, when I meet with investors around the world they are saying, ‘Tom, are you worried about your over-exposure to Australia?’," Mr Albanese said at a charity event for cancer in Brisbane on Friday.

“That’s not a good thing, that’s a damning testimony for where Australia fits – it’s not something to get fretful about, but it’s something that should be recognised as a problem."

“I have got shareholders, some of whom I am meeting later today, who are saying increasingly, ‘We want our money back, we don’t want you to keep investing it.’"

He criticised over-regulation and warned about increasing costs that could put the future of projects in doubt.

Mr Albanese said Rio Tinto’s Hail Creek mine cost $280 million to develop, but that only a week ago a new fleet addition was required at a cost of $150 million. “That is an incredible escalation," he said. “What I fear is that over the next couple of years we will see the same sort of capital escalation.

“I am bullish about Queensland, but let’s do it in light of the facts."

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“We already have more than enough chatter around the world about the $150,000 truck driver, about the $250,000 engineer," he said.

“The mining industry in Australia has by far the world’s highest labour costs. It’s probably 50 per cent more for professionals than the US, it’s certainly double, triple or 10 times more than other competing mining locations. That’s OK, but as long as there is productivity commensurate with those higher wages."